Foreign Relations of the United States, 1949, The Far East and Australasia, Volume VII, Part 2

Executive Secretariat Files

Report by the National Security Council on Recommendations With Respect to United States Policy Toward Japan ¹

top secret

[Washington,] May 6, 1949.

NSC 13/3

The Peace Treaty

1. Timing and Procedure. In view of the differences which have developed among the interested countries regarding the procedure and substance of a Japanese peace treaty and in view of the serious international situation created by the Soviet Union’s policy of aggressive Communist expansion, this Government should not press for a treaty of peace at this time. It should remain prepared to proceed with the negotiations, under some generally acceptable voting procedure, if the Allied Powers can agree among themselves on such a procedure. We should, before actually entering into a peace conference, seek through the diplomatic channel the concurrence of a majority of the participating countries in the principal points of content we desire to have in such a treaty. Meanwhile, we should concentrate our attention on the preparation of the Japanese for the eventual removal of the regime of control.

2. The Nature of the Treaty. It should be our aim to have the treaty, when finally negotiated, as brief, as general, and as nonpunitive as possible. To this end we should try to clear away during this intervening period as many as possible of the matters which might otherwise be expected to enter into the treaty of peace. Our aim should be to reduce as far as possible the number of questions to be treated in the peace treaty. This applies particularly to such matters as property rights, restitution, etc. Our policy for the coming period should be shaped specifically with this in mind.

Security Matters

3. The Pre-Treaty Arrangements. Every effort, consistent with the proper performance of the occupational mission as envisaged in this policy paper and with military security and morale, should be made to reduce to a minimum the psychological impact of the presence of occupational forces on the Japanese population. The numbers of tactical, and especially non-tactical, forces should be minimized. In determining the location of occupation forces, their employment, and support from the Japanese economy in the pre-treaty period, full weight should be given to the foregoing.

4. The Post-Treaty Arrangements. United States tactical forces should be retained in Japan until the entrance into effect of a peace treaty. A final U.S. position concerning the post-treaty arrangements for Japanese military security should not be formulated until the peace negotiations are upon us. It should then be formulated in the light of the prevailing international situation and of the degree of internal stability achieved in Japan.

5. The Ryukyu, Nanpo and Marcus Islands. The United States intends to retain on a long-term basis the facilities at Okinawa and such other facilities as are deemed by the Joint Chiefs of Staff to be necessary in the Ryukyu Islands south of 29° N., Marcus Island and the Nanpo Shoto south of Sofu Gran. The military bases at or near Okinawa should be developed accordingly. The United States agencies responsible for administering the above-mentioned islands should promptly formulate and carry out a program on a long-term basis for the economic and social well-being and, to the extent practicable, for the eventual reduction to a minimum of the deficit in the economy of the natives. At the proper time, international sanction should be obtained by the means then most feasible for United States long-term strategic control of the Ryukyu Islands south of latitude 29° N., Marcus Island and the Nanpo Shoto south of Sofu Gan.

The United States has determined that it is now in the United States national interest to alleviate the burden now borne by those of the Ryukyu Islands south of latitude 29° N. incident to their contribution to occupation costs, to the extent necessary to establish political and economic security. While it would not be in the interest of the United States to make a public announcement on this matter, and while it is not believed appropriate to obtain international sanction of this intent at this time, the United States national policy toward the Ryukyu Islands south of latitude 29° N. requires that United States Armed Forces and other Government agencies stationed therein pay their way to the extent necessary and practical to carry out the above-mentioned program for the economic and social well-being and towards eventual reduction to a minimum of the deficit in the economy of the natives in this area beginning sixty days after this date, and that these Islands must then no longer be financially dependent upon or obligated to any other occupied area.

6. Naval Bases. The United States Navy should shape its policy in the development of the Yokosuka base in such a way as to favor the retention on a commercial basis in the post-treaty period of as many as possible of the facilities it now enjoys there. Meanwhile, it should proceed to develop the possibilities of Okinawa as a naval base, on the assumption that we will remain in control there on a long-term basis. This policy does not preclude the retention of a naval base as such at Yokosuka if, at the time of finalizing the U.S. position concerning the post-treaty arrangements for Japanese military security, the prevailing international situation makes such action desirable and if it is consistent with U.S. political objectives.

7. The Japanese Police Establishment. The Japanese Police establishment, including the coastal patrol, should be strengthened by the re-enforcing and re-equipping of the present forces, and by expanding the present centrally directed police organization.

The Regime of Control

8. Supreme Commander for the Allied Powers. This Government should not at this time propose or consent to any major change in the regime of control. SCAP should accordingly be formally maintained in all its existing rights and powers. However, responsibility should be placed to a steadily increasing degree in the hands of the Japanese Government. To this end the view of the United States Government should be communicated to SCAP that the scope of its operations should be reduced as rapidly as possible, with a corresponding reduction in personnel, to a point where its mission will consist largely of general supervisory observation of the activities of the Japanese Government and of contact with the latter at high levels on questions of broad governmental policy.

9. Far Eastern Commission. The United States Government should ensure for its own part, and urge upon other FEC member Governments, that proposals considered by the FEC be confined strictly to policy matters directly related to the fulfillment by Japan of its obligations under the Terms of Surrender, and be couched in broad terms leaving questions of implementation and administration to SCAP. The position of the United States should further be based upon the fact that these surrender terms, as envisaged by the Potsdam Declaration, have been substantially implemented. On matters still within the purview of the FEC, such as civil aviation policy in Japan, the United States Government should seek to establish as promptly as possible firm United States positions and then adopt an aggressive and positive attitude, by direct discussions with FEC member Governments and by forceful backing in the FEC of policies desired by the United States. In matters of urgency, where it has become evident that, after efforts to achieve maximum international support, agreement cannot be promptly reached, we should not hesitate to use the interim directive. SCAP should also be encouraged to make greater use of his authority as sole executive for the Allied Powers, asking where necessary for the United States Government’s views. On the other hand, the United States Government should not hesitate to render assistance to SCAP by elucidating its interpretation of previous directives and general policies, notably those appearing in the “Basic Post-Surrender Policy for Japan”.

10. Allied Council. The Allied Council should be continued, with its functions unchanged.

Occupational Policy

11. Relations with the Japanese Government. (See paragraph 8 above.)

12. Internal Political and Economic Changes. Henceforth emphasis should be given to Japanese assimilation of the reform programs. To this end, while SCAP should not stand in the way of reform measures initiated by the Japanese if he finds them consistent with the overall objectives of the occupation, he should be advised not to press upon the Japanese Government any further reform legislation. As for reform measures already taken or in process of preparation by the Japanese authorities, SCAP should be advised to relax pressure steadily but unobtrusively on the Japanese Government in connection with these reforms and should intervene only if the Japanese authorities revoke or compromise the fundamentals of the reforms as they proceed in their own way with the process of implementation and adjustment. If exigencies of the situation permit, SCAP should consult with the U.S. Government before intervention in the event the Japanese should resort to action of such serious import. Definite background guidance embodying the above principles and indicating the United States Government’s view as to the nature and extent of the adjustment to be permitted should be provided SCAP in the case of certain reforms.

13. The Purge. Since the purpose of the purge has been largely accomplished, the U.S. now should advise SCAP to inform the Japanese Government informally that no further extension of the purge is contemplated and that the purge should be modified along the following lines: (1) Categories of persons who have been purged or who are subject to the purge by virtue of their having held relatively harmless positions should be made re-eligible for governmental, business and public media positions; (2) certain others who have been barred or who are subject to being barred from public life on the basis of positions occupied should be allowed to have their cases re-examined solely on the basis of personal actions; and (3) a minimum age limit should be fixed, under which no screening for public office would be required.

14. Occupation Costs. The occupational costs borne by the Japanese Government should continue to be reduced to the maximum extent consonant with the policy objectives of the pre-treaty period as envisaged in this paper.

15. Economic Recovery. Second only to U.S. security interests, economic recovery should be made the primary objective of United States policy in Japan for the coming period. It should be sought through a combination of United States aid program envisaging shipments and/or credits on a declining scale over a number of years, and by a vigorous and concerted effort by all interested agencies and departments of the United States Government to cut away existing obstacles to the revival of Japanese foreign trade, with provision for Japanese merchant shipping, and to facilitate restoration and development of Japan’s exports. In developing Japan’s internal and external trade and industry, private enterprise should be encouraged. Recommendations concerning the implementation of the above points, formulated in the light of Japan’s economic relationship with other Far Eastern countries, should be worked out between the State and Army Departments after consultation with the other interested departments and agencies of the Government. We should make it clear to the Japanese Government that the success of the recovery program will in large part depend on Japanese efforts to raise production and to maintain high export levels through hard work, a minimum of work-stoppages, internal austerity measures and the stern combatting of inflationary trends including efforts to achieve a balanced internal budget as rapidly as possible.

16. Property Matters. SCAP should be advised to expedite the restoration or final disposal of property of United Nations members and their nationals in such a way that the process will be substantially completed by July 1, 1949. It should be the objective of United States policy to have all property matters straightened out as soon as possible and certainly well in advance of a treaty of peace in order that they may not hamper treaty negotiations.

17. Information and Education.

• a. Censorship. Censorship of literary materials entering Japan should be conducted with the minimum of delay and pre-censorship of the Japanese press should cease. This should not operate, however, to prevent SCAP from exercising a broad post-censorship supervision and from engaging in counter-intelligence spot-checking of the mails.
• b. Radio. The United States Government should immediately undertake a regular program of medium- and long-wave broadcasts to Japan from a suitably located transmitter station possibly on Okinawa. These programs should be carefully prepared with a view to developing an understanding and appreciation of American ideas and at the same time to maintaining as wide a Japanese radio audience as possible.
• c. Interchange of Persons. The interchange between Japan and the United States of scholars, teachers, lecturers, scientists and technicians should be strongly encouraged. SCAP should continue the policy of permitting approved Japanese to go abroad for cultural as well as economic purposes.

18. War Crime Trials. The trial of Class A suspects is completed and decision of the court is awaited. We should continue and push to an early conclusion the screening of all “B” and “C” suspects with a view to releasing those whose cases we do not intend to prosecute. Trials of the others should be instituted and concluded at the earliest possible date.

19. Control of Japanese Economic War Potential. Production in, importation into, and use within Japan of goods and economic services for bona fide peaceful purposes should be permitted without limitation, except:

a. Japan’s economic war potential should be controlled by restrictions on allowable stockpiling of designated strategic raw materials in Japan.

b. Japan’s industrial disarmament should be limited to the prohibition of the manufacture of weapons of war and civil aircraft and the minimum of temporary restrictions on industrial production which can be advocated in the light of commitments already made by the United States regarding the reduction of the industrial war potential.

20. Japanese Reparations. It should be the policy of the United States Government that current transfers of reparations under unilateral U.S. directive should be terminated and every effort made to secure acceptance by the other reparations claimant countries of the principle that the reparations question as a whole should be reduced to the status of a dead letter. After advising friendly FEC nations of our intended course and of the considerations underlying our position, the United States should take the following specific actions:

a. Rescind the Advance Transfers Directive of April 4, 1947 (JCS Directive No. 75),² except for allocations already processed under that directive.

b. Withdraw its proposal of November 6, 1947, on reparations shares.

c. Announce to the FEC and publicly that it has no intention of using its unilateral powers to make possible additional industrial reparations removals.

d. Announce to the FEC and publicly its views:

(1) That all industrial facilities, including so-called “primary war facilities”, presently designated as available for reparations which can contribute to Japanese recovery should be utilized as necessary, except for scrapping, in Japan’s peaceful economy for recovery purposes.

(2) That with regard to “primary war facilities”, all of which were some time ago stripped of their special purpose equipment and thus of their “war facilities” characteristics, SCAP, under the authority granted in paragraph 10 of the FEC decision on Reduction of Japanese Industrial War Potential, should as rapidly as practicable require the dismantlement, dispersion or other action for the utilization in Japan’s peaceful economy of such of these facilities as are required to meet the needs of the occupation, which needs prominently include economic recovery. Under paragraph 10 SCAP may develop a suitable system for using such facilities, individually or collectively, upon notification and explanation to the Allied Council for Japan. Pursuant to the above-mentioned FEC decision requiring their “impounding”, remaining “primary war facilities” should continue to be protected, in the sense of preventing loss or scrapping of individual items. Impounding does not, however, include requirement that the facilities be kept in their present locations or that the Japanese or the occupation authorities devote resources to preserve their value or maintain them in working order.

(3) That there should be no limitation on Japan’s production for peaceful purposes or on levels of Japanese productive capacity in industries devoted to peaceful purposes.

e. Submit to the FEC proposals, regardless of likely unfavorable reception, for the rescission or amendment of existing and pending FEC reparations and “levels-of-industry” policy papers so as to bring them in as close conformity as possible with U.S. policy that there should be no further industrial reparations removals from Japan and no limitation on levels of Japanese peaceful productive capacity; and prevent action by the FEC contrary to U.S. policy.

1. Adopted at the NSC’s 23d meeting May 6 as a revision of NSC 13/2, October 7, 1948, Foreign Relations, 1948, vol. vi, p. 858. It “represents current U.S. policy toward Japan as approved by the President upon the advice of the Council”.
2. Foreign Relations, 1947, vol. vi, p. 376.